Introduction Infinite banking is a very interesting financial concept that uses whole life insurance to execute on a number of financial operations that are typically available only through a bank. This is why the infinite banking concept is sometimes called “being your own banker.” The concept won some popularity in the U.S. and also in Canada. In this article, we asked one of the leading Canadian experts on this topic, Glen Zacher, to share his experience and knowledge. What is infinite ...

I’m going to talk a little bit about the face amount of a life insurance policy and how it works. Generally, the face amount of a life insurance policy is the death benefit of the policy, so the higher the face amount, the higher the premium. There are a lot if things that influence a life insurance premium: the person’s gender, the person’s health, the person’s age, the type of plan; but the face amount is a big element because obviously a $100,000 policy is going to be less than a ...

 I’m going to talk a little bit now about cash surrender value and how it works in terms of a life insurance policy. Generally, cash surrender values apply to permanent policies, and permanent policies can be whole life coverage, can be Term-100, or can be universal life. Most Term-100 policies don’t have a cash surrender value, but whole life policies and most universal life policies do. A whole life policy can either be participating or non-participating. Participating policies have a ...

 We get a lot of questions about the accidental death benefit and how it works in terms of life insurance. An accidental death benefit is generally something that pays out, or a type of insurance that pays out, if the person dies in an accident. Now, keep in mind that probably less than 2 per cent of all life insurance claims are related to an accident. A lot of people think it’s a higher figure, but most of the life insurance claims are going to be caused by some type of illness—cancer, ...

LSM Insurance Independent Broker, Beirong Xiong has learned to take the good with the bad when life’s surprises come knocking at her door. After finishing her Master’s in Agricultural Economics and Business at the University of Guelph, Beirong moved to Ottawa (Ontario) to pursue a career in financial services. It was on a daily elevator ride that she met her future husband for the first time. “Something as random as that changed my life for the better,” she says. “Six years later David ...

I’m going to talk a little bit about an irrevocable beneficiary and how it works in terms of a life insurance policy. Irrevocable beneficiaries are unique in that the policy owner needs the consent of the beneficiary to change that beneficiary. Irrevocable beneficiary designations are often set up as part of a marital breakup. The ex-spouses want to know, as part of the settlement, that the policy owner is going to keep that ex-spouse on as a beneficiary, and that they can’t change that ...

We received a question asking what the grace period on a life insurance policy is. Generally, the grace period applies if you miss a payment and you want to make sure the policy doesn’t lapse. That’s where the grace period kicks in. If you had an annual premium on a policy—let’s say it was $700 a year, or whatever the annual premium was—and the payment wasn’t sent in, the insurance company will generally give a 31-day grace period. That could be different, so you always want to make sure ...

I’m going to talk a little bit today about smoking versus non-smoking in terms of your life insurance. Smoking can have a really big impact in terms of your life insurance premiums. Some companies on a term insurance policy will charge up to three times as much for a smoker versus what they charge for a non-smoker. It’s something you’re really going to want to understand. You are going to want to understand the definition within the different life insurance companies. Most companies ...

 I’m going to talk a little bit today about a question I got on how you can use a whole life insurance policy to help with your retirement. A whole life policy generally allows you to build a cash value in addition to the insurance. This cash value is growing in a tax shelter basis, so some people will use that cash value to supplement their retirement income. That person will want to make sure they are taking advantage of things like RRSPs and tax-free savings accounts, if it fits ...

The world today is not the same as it was 30 years ago. That is why some of the questions insurance clients are asking deal with the realities of this complicated world. One of these questions relates to life insurance and terrorism, and how insurance companies treat these cases. In fact, there are several scenarios, and it is important to understand all of them. Also, it is important to understand that, while some companies deal with this topic differently than others, the key principles ...